According to the government, black money is any money that is not digitally transacted or taxed. By this thinking, at least 85% of the country owns black money

Let’s start with a confession: I don’t understand all these new-fangled notions of black money. And why it is called so in the first place. I suspect there’s some racist undertone to it, somewhere. But that is, I guess, a separate discussion. Yet, like all of you, I also hate black money. Why? I guess I am programmed to. Like everyone else I have fallen in line with what is politically correct.

Even the strongest critics of the prime minister, those who have most vehemently opposed demonetisation, are actually standing in line to say how bad black money is. So why not me? But let’s start with: What is black money? The quickest description is: Black money is money acquired through black deeds. In short, money from corruption. Now, that’s something I gladly agree with. Like all of you, I hate corruption. I voted against it in the last Lok Sabha elections, as did most of India. And I am happy to see the prime minister is still at it.

Every speech of his talks about corruption — and the Gandhis of course. But my simple concern is I am not sure how demonetisation (or remonetisation as some in government are now calling it) will help fight corruption. Most of those hurting today are not corrupt. They are, in fact, the victims of corruption, those who voted against it. By accident or by design, I am not quite sure which, they have now become collateral damage. Wiser men than me are saying that all the money taken out of the economy when the big notes were demonetised will most probably come back.

If there’s asmall gap, it will be easily filled in by the year end. (Is that why the government is so anxious to find new ways to stop people from depositing their own money in their own bank accounts before December 31?) Anew notification on Monday (the 59th since November 8) declared (in clear violation of the prime minister’s own assurances that anyone can bank their own money without any worry before the year-end) that deposits of above Rs 5,000 in old currency can be made only once. And the credit for these deposits will be only given after two bank officials quiz the depositor, as to why this money was not deposited earlier.

An inadequate explanation could lose you your own money or, worse, initiate a tax inquiry. For what? For delaying the deposit of your own money in your own bank? (On November 11, three days after demonetisation, the government had published ads telling people not to panic, that their hardearned money is totally safe). Small businessmen, housewives, artisans, workers and others were assured that they can deposit old currency up to Rs 2,50,000 in their bank accounts which will not be reported to the Income Tax Department and there will be no harassment or investigation as long as the money is deposited before December 31.

Some economists warn that we may actually end up getting back more money than was withdrawn by demonetisation. This leads to two possible conclusions. One: There’s no serious amount of black money in the economy. (You may even end up concurring with those who believe that black money accounts for barely 5% of the money in circulation. We can afford not to lose our sleep over it.) Two: The black money that exists is not in cash. (Now that is what anyone with a modicum of sense would agree with.) All money, but particularly black money, survives on its velocity.

By hiding notes under the mattress, you can only destroy it. And, oh yes, you also run the risk of being caught. So why not simply park it offshore. As most of our politicians and businessmen do? It’s simple. You don’t even have to go abroad. The banks come to you. But all this is not money from corruption. So now, the government has expanded the meaning of black money to also include money on which taxes may not have been paid. But not all money that sidesteps taxes is black money. Farmers don’t pay taxes. Many retired people don’t pay taxes.

Daily labourers on construction sites don’t pay taxes. There are actually millions of honest, self-respecting citizens who have stayed away from the tax net because they were allowed to. By law and often by convention. Most small traders and businessmen (curiously, among the BJP’s biggest supporters) operate outside the banking system, not because they hide their earnings but because what they earn goes straight back into their business. Like small dhaba owners or tea stall vendors. They work on tiny margins and keep their money in cash because that’s the only way to meet daily expenses.

It’s silly to expect them to hire accountants, keep records of every cup of tea or parantha sold and appoint auditors. Curiously, the meaning of black money is now being further extended. Guess why? To include all money that is not digitally transacted. A school of thought is being quietly encouraged (no doubt by those who run credit card and digital payment businesses) that those who do not transact digitally and prefer working in the old fashioned cash economy are doing so to avoid taxes. This is untrue. Over 85% Indians still transact in cash and have no reason to be ashamed for doing so.

The definition of black money keeps gaining elasticity just because we want to prove to ourselves that the black economy in India is as monstrous as we make it out to be in our political rhetoric. I think it’s time to stop whipping ourselves. And stop hurting our own people. And focus instead on building the new India we promised ourselves. This is a good time to start.

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